Super Threading India Pvt. Ltd. vs Union of India

The petitioner seeks a direction for release of goods which were sought to be exported through Shipping Bill dated 20-1-2012 unconditionally. In this case, the declared FOB value of the goods was ` 22,00,278/-. At that stage, the Customs authorities interceded and detained the goods, claiming the need for investigation and further action, if necessary, in accordance with law. The petitioner complains that the inordinate delay by the Customs authorities in taking further action has caused grave prejudice. Learned counsel emphasises that the delay in making timely investigation and taking further follow-up action under the Customs Act has resulted in cancellation of export order, besides accrual of other charges, such as detention and warehouse charges. It is contended that in these circumstances, the Court should be alive to the hardship and pass appropriate orders enabling provisional unconditional release of the goods. Learned counsel relied upon the Circular of the Central Board of Excise and Customs (C.B.E. & C.) dated 5-8-2013, which in its material details reads as follows:

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It has been brought to the notice of the Board that the above instructions are not being implemented by certain field formations and exporting community is aggrieved by the long detention of export goods. The matter has been raised in many forums and the issue of congestion in ports has also been highlighted by Inter-Ministerial Committee for boosting exports from Micro, Small and Medium Enterprises (MSMEs) sector, which pointed out that, besides the Board''s aforementioned instructions, paragraph 2.42 of the Foreign Trade Policy also provides that export consignments shall not be withheld/delayed for any reason.

The Board has re-examined the subject matter. The view is that there can be no justification to hold up export consignments for long periods unless the export goods are prohibited under Customs Act, 1962 or ITC (HS) Policy. Essentially genuine exports must be facilitated and there should be no delays or hold ups of export goods. Therefore, the Board strongly reiterates the instruction dated 4-1-2011 referred above. It shall be the responsibility of Commissioner of Customs concerned to ensure strict compliance of these instructions. Needless to state any deviation or lapse shall be proceeded against by the Board.

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Learned counsel for the respondents urged that in this case, though the declared value of the goods was in excess of ` 22 lakhs, after much effort, the petitioner chose to participate in the investigation which ultimately resulted in the order of the Chartered Engineer according to which the value of goods was not ` 22 lakhs but ` 5,04,561/-. It was consequently decided that this case was one of over-invoicing and the effort of the petitioner is to seek undue advantage by way of unjustified drawbacks. Learned counsel stated that in these circumstances a show cause notice was issued on 13-12-2013, proposing confiscation and penalty under Section 114 of the Customs Act.

This Court has considered the submissions. There appears to be some delay in the issue of show cause notice even though the goods were sought to be exported in February 2012, the notice was apparently issued on 13-12-2013. The respondent''s/Revenue''s contention with regard to the petitioner''s contributory delay in this is an aspect which cannot be gone into in the writ proceedings. So far as the petitioner''s argument with respect to applicability of C.B.E. & C. Circular is concerned, the Court is satisfied that it cannot be seen as one of universal application and that the given facts of each case have to be taken into account. This is evident from a reading of para 3 of the Circular which talks of ''genuine exports''. When the matter as to the genuineness of the petitioner''s claims with respect to the value of goods is itself in dispute, this Court is of the opinion that this Circular cannot be insisted upon for a direction which is sought in this case.

In view of the above, the only order that the Court can give is to direct the respondents to conduct an adjudication pursuant to the show cause notice as expeditiously as possible and in any event within three months from today. The writ petition is disposed of in the above terms.